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Oil Trims Week's Gains Under Weight of Global Inventory

Crude-oil prices eased on Friday, trimming gains for the week, as traders weigh inventory data and look to the global oil cartel to extend a production-cut deal later this month.

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Light, sweet crude for June delivery lost 42 cents, or 0.9%, to $47.41 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, fell 40 cents, or 0.8%, to $50.37 a barrel.

The latest report from the Organization of the Petroleum Exporting Countries published Thursday showed that cartel members were sticking to the production quotas agreed on Nov. 30. In April, OPEC's total output dropped again to an average of 31.73 million barrels a day. This means the cartel's production has fallen by more than the 1.2 million barrels a day that it had pledged in November.

The OPEC report, however, also revised growth in oil supplies from countries outside of the cartel membership upward to 950,000 barrels a day this year. The new forecast is based largely on higher-than-expected output growth from U.S. shale-oil producers and Canadian oil-sands operations.

The growth in non-OPEC output is expected to prompt the cartel to agree to extend its production cuts into the second half of the year when it meets on May 25. "The odds of a larger and longer cut now outweigh the odds of nothing, no cut at all," said Scott Shelton, a broker at ICAP PLC.

Still, prices won't likely rebound quickly because of accelerating production from countries including the U.S., Brazil, Canada, and even OPEC members Nigeria and Libya. Indeed, the decline of oil inventories, particularly in the U.S., has so far been slower than analysts had anticipated.

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"Capped OPEC/Russian production and accelerating seasonal demand into 3Q17 should see a greater drawdown in oil inventories; this assumes the 2016 Vienna output deal is reaffirmed on 25 May," said Giovanni Staunovo, analyst in UBS Wealth Management.

OPEC will also be mindful that U.S. producers will likely expand output and take more market share away from the cartel the longer it curbs production, said Tom Pugh, a commodities economist at Capital Economics.

"As such, it is likely to extend its production cuts by the minimum amount of time necessary to bring stocks down to more normal levels," he noted.

Gasoline futures rose 0.4% to $1.5689 a gallon, and diesel futures edged down 0.1% to $1.4885 a gallon.

Write to Sarah McFarlane at sarah.mcfarlane@wsj.com and Jenny W. Hsu at jenny.hsu@wsj.com